.svg)
Contractor
What is a Contractor?
In the construction industry, a contractor is the party responsible for delivering a project or a portion of it, typically under a formal agreement with the project owner. Contractors oversee labor, materials, equipment, and scheduling to ensure work is completed according to the contract’s scope, quality standards, and timeline.
A general contractor (GC), sometimes called a prime contractor, manages the overall project and hires subcontractors to perform specialized work such as electrical, plumbing, or concrete. Whether a contractor is a GC or a subcontractor, they operate under legally binding terms that outline deliverables, payment schedules, and compliance requirements.
Being a contractor means navigating complex billing requirements—especially on the subcontractor side. Pay applications must match each client’s requirements, include precise documentation, and often wait on a chain of approvals before payment is released. Any hiccup (e.g., a missing lien waiver, the wrong form, an incorrect total) can push payment weeks or even months past due. In an industry where it already takes an average of 96 days to get paid, those delays can put serious strain on cash flow.
Siteline was built to help commercial subcontractors overcome these hurdles. Our software automates pay application creation, keeps lien waivers organized and compliant, and tracks payment status in real time. By streamlining the billing process, contractors using Siteline can avoid lengthy payment delays, strengthen relationships with GCs, and get paid faster.
Trusted by trade contractors across the country
Other construction terms
What is a Debit?
A debit, in the construction industry, refers to an entry which represents an increase in expenses or a decrease in income for the business. It could come from paying for labor, materials, overheads, or any other costs related to a construction project. It could also come from a decrease in revenue due to a project delay, change in project scope, or a decrease in clients' payment. An understanding of debits is pivotal in managing the financial aspects of construction because it affects cash flow and profitability. The term is part of the double-entry accounting system used widely across industries, including construction, where for every debit entry, there must be a corresponding credit entry. Therefore, properly tracking and categorizing debits is crucial in financial planning and management in construction.
What is percentage of completion?
Percentage of completion (POC) is a metric that represents the proportion of work completed on a construction project at a given point in time. It is expressed as a percentage of the total contracted work. The POC is important to subcontractor workflows for several reasons:
- Payment schedules: Most construction contracts stipulate that subcontractors receive payment based on the percentage of work completed rather than a lump sum payment at the end of the project. The POC determines the amount of payment that a subcontractor can request from the general contractor (GC) or the project owner for the work performed during a specific billing period.
- Cash flow management: Subcontractors rely on progress payments to maintain a healthy cash flow and cover expenses such as labor, materials, and equipment. The POC directly impacts the timing and amount of progress payments received, allowing subcontractors to plan and manage their financial resources effectively.
- Project monitoring and control: Tracking the POC helps subcontractors monitor their progress against the project schedule and budget. It enables them to identify potential delays or cost overruns early on, allowing for prompt corrective actions.
- Dispute resolution: In the event of disputes or claims related to payment or project delays, POC documentation can serve as evidence to support the subcontractor's position and substantiate their claims for outstanding payments or compensation.
- Resource allocation: By monitoring the POC, subcontractors can better plan and allocate their resources (labor, materials, equipment, etc.) across multiple projects, ensuring efficient utilization and avoiding resource conflicts or shortages.
- Project closeout: The POC is crucial during the project closeout phase, as it helps determine the final payment due to the subcontractor and ensures that all work has been completed according to the contract terms.
Overall, POC serves as a versatile tool throughout the entire project lifecycle, from initial payment requests to final closeout. And with Siteline, managing POC workflows becomes effortless. Siteline makes progress billing a cinch by:
- Generating custom pay applications with real-time POC calculations
- Offering intuitive dashboards for clear financial visualization and decision-making
- Integrating with GC payment portals for accurate, timely pay application submissions
- Centralizing all documentation for enhanced collaboration and communication
Book a demo today to experience how Siteline can empower your team to make informed decisions, maintain a steady cash flow, and ensure successful project closeouts.
What is a General Ledger (G/L)?
A General Ledger (G/L) in the construction industry is a fundamental financial tool for recording all financial transactions of a construction company including assets, liabilities, equity, revenue, and expenses. It not only reflects every financial transaction related to a construction project, but also contains crucial details such as date, description, and transaction amount. Essentially, the G/L acts as the core of a construction company's financial record system where all transaction data from sub-ledgers or modules, such as accounts payable, accounts receivable, and cash management, are consolidated. It provides a comprehensive financial picture necessary for reporting and strategic decision-making in the construction business. By regularly maintaining and auditing the G/L, construction companies can ensure financial accuracy and compliance, as well as evaluate their financial performance and stability.
Ready to end the fire drill and get paid faster?
